MUMBAI: Benchmark indices Sensex and Nifty declined on Wednesday, pressured by banking and financial stocks amid weak global market trends.
Additionally, weak earnings reports and continuous foreign fund outflows dampened market sentiment, traders said.
With more Domestic Institutional Investors (DII) and retail investments entering the market, along with tapering FII selling, the market may receive a near-term boost
The BSE Sensex fell 426.85 points, or 0.53 per cent, closing at 79,942.18. The NSE Nifty slipped by 126 points, or 0.51 per cent, to settle at 24,340.85.
Among the 30-share Sensex components, Infosys, ICICI Bank, Kotak Mahindra Bank, Mahindra & Mahindra, State Bank of India, HCL Technologies, Axis Bank, NTPC, and HDFC Bank were among the main laggards.
Conversely, Maruti, IndusInd Bank, Adani Ports, ITC, and UltraTech Cement ended in positive territory, defying broader market trends.
FIIs net sellers
Foreign institutional investors (FIIs) were net sellers in the capital markets on Tuesday, offloading shares worth Rs548.69 crore, according to exchange data.
In the near term, the market will be influenced by two factors – one positive and one negative. The positive factor is the sharp decline in FII selling to just Rs548 crore on Tuesday, indicating that the FII tactical trade of ‘Sell India, Buy China’ is winding down.
“With more Domestic Institutional Investors (DII) and retail investments entering the market, along with tapering FII selling, the market may receive a near-term boost, especially during the festive season. However, sustained uptrend is unlikely due to softness in Q2 earnings, impacting FY25 projections,” VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services, noted.
Asian markets
In Asia, markets in Seoul, Shanghai, and Hong Kong closed lower, while Tokyo ended in positive territory. European markets were trading lower, and U.S markets closed with mixed results on Tuesday.
Meanwhile, Brent crude, the global oil benchmark, rose by 0.63 per cent to $71.57 per barrel.
On Tuesday, the BSE benchmark had climbed 363.99 points, or 0.45 per cent, to close at 80,369.03, while the Nifty gained 127.70 points, or 0.52 per cent, to reach 24,466.85.
